ALTMAN et al v. LIBERTY HELICOPTERS, INC. et al
MEMORANDUM AND/OR OPINION. SIGNED BY HONORABLE EDMUND V. LUDWIG ON 7/29/10. 7/29/10 ENTERED AND COPIES MAILED AND E-MAILED.(kw, )
A L T M A N et al v. LIBERTY HELICOPTERS, INC. et al
D o c . 48
IN THE UNITED STATES DISTRICT COURT F O R THE EASTERN DISTRICT OF PENNSYLVANIA JA C L Y N ALTMAN v. L IB E R T Y HELICOPTERS, et al. : : : : : MEMORANDUM L u d w ig , J. Ju ly 29, 2010 C IV IL ACTION
N o . 10-545
T h is death benefits action arises from a collision on August 8, 2009 between a h e lic op te r and a private plane over the Hudson River. Jurisdiction is the Federal Tort Claims A c t. 28 U.S.C. § 1346. 1 P lain tiff Jaclyn Altman commenced the action on behalf of herself and as Executrix o f the Estate of Daniel Altman, her husband, and as Administratrix of the Estate of Douglas A ltm a n , her minor son. These decedents were passengers on a Piper N71MC aircraft operated
Currently, ten cases are pending because of the collision. Originally commenced in this co u rt is Altman v. United States, Civ. A. No. 10-518, a virtually identical action filed by Pamela A ltm a n on behalf of herself and as Executrix of the Estate of Steven Altman. An earlier case filed in this court, Altman v. Liberty Helicopters, Inc., Civ. A. No. 09-4437, was dismissed on January 1 3 , 2010 for lack of subject matter jurisdiction. There are two cases pending in Pennsylvania state co u rt. Exhibits D and E to the Supplemental Declaration of Thomas C. Regan, filed with d e fe n d a n t's reply brief. Six cases are pending in New Jersey. An action begun in New Jersey state court, United S ta te Aviation Underwriters, Inc., et al. v. Estate of Steven Altman, No. BER-L-8059-09, was the f ir s t filed. Exhibit A to the Declaration of Thomas C. Regan. Five additional actions filed in New J e r s ey District court on behalf of the deceased passengers of the helicopter have been c o n so lid ate d . Exhibit B to Regan Declaration. A ls o pending is plaintiff's motion before the United States Judicial Panel on Multi-District L itig atio n . On June 7, 2010, upon hearing, the Panel requested that this court resolve defendant L ib erty 's motion to dismiss or, in the alternative, to transfer to the District of New Jersey under 28 U .S .C . § 1404(a) and granted sixty days within which to do so. See In re: Air Crash Over the H u d so n River Near New York, New York, on August 8, 2009, MDL No. 2152.
b y a private pilot.
Defendants are the United States of America (Federal Aviation
A d m in istra tio n ), LCA Partnership (owner of the aircraft), Pamela Altman, Executrix of the E s ta te of Steven P. Altman (the deceased pilot), and Liberty Helicopters, Inc. (the operator of th e helicopter involved in the collision). Also sued in the original complaint was Meridian C o n s u ltin g I Corporation, Inc., the helicopter owner. On March 11, 2010, plaintiff filed an a m e n d e d complaint against all defendants except Meridian 2. D e fe n d an t Liberty moves to dismiss on the ground that Meridian is a necessary party that was deliberately omitted from the amended complaint, Fed. R. Civ. P. 19(a),3 and also a n indispensable party under Fed. R. Civ. P. 19(b).4 In the alternative, Liberty requests that
Meridian is still a defendant in the related action pending in this court. It has moved to d is m is s the claims against it for lack of personal jurisdiction. Civ. A. No. 10-518, docket no. 4.
Relevantly, Rule 19(a) states:
A person who is subject to service of process and whose joinder will not deprive the court o f jurisdiction over the subject matter of the action shall be joined as a party in the action if (1 ) in the person's absence complete relief cannot be accorded among those already p a r t ie s , or (2) the person claims an interest relating to the subject of the action and is so s itu a t e d that the disposition of the action in the person's absence may (i) as a practical m a tte r impair or impede the person's ability to protect that interest or (ii) leave any of the p ers o n s already parties subject to a substantial risk of incurring double, multiple, or o th e rw is e inconsistent obligation by reason of the claimed interest..
I f a person as described in subdivision (a)(1)-(2) hereof cannot be made a party, the court s h all determine whether in equity and good conscience the action should proceed among th e parties before it, or should be dismissed, the absent person being thus regarded as ind isp en sab le. The factors to be considered by the court include: first, to what extent a ju d g m e n t rendered in the person's absence might be prejudicial to the person or to those a lre a d y parties; second, the extent to which, by protective provisions in the judgment, by th e shaping of relief, or other measures, the prejudice can be lessened or avoided; third, w h eth er a judgment rendered in the person's absence will be adequate; fourth, whether the p l a in t if f will have an adequate remedy if the action is dismissed for nonjoinder.
th e action be transferred to the District of New Jersey, 28 U.S.C. § 1404(a).5 For the reasons th a t follow, Liberty's motion to dismiss the complaint will be denied as moot. Its motion to tra n sfe r the action to the District of New Jersey will be granted without prejudice to the issue o f that district's jurisdiction. A c c o rd in g to the undisputed record, 6 Meridian owned the helicopter involved in the a c cid e n t. The lease was a "dry lease" in which Meridian supplied the helicopter and Liberty p a id rent and was responsible for the aircraft's operation and maintenance, and provided p ilo ts, passenger amenities, licensing and certification of equipment and personnel, and met a ll other flight requirements. "Declaration in Lieu of Oath of Christopher Vellios, Chief O p e ra tin g Officer of Meridian Consulting I Corporation." T h e original complaint alleged that Liberty and Meridian were subsidiaries of each o th e r or were engaged in a joint business enterprise. ¶ 11-12; and further that Liberty and M e rid ia n owned, operated and maintained the helicopter, and were both vicariously liable for th e acts, omissions and negligence of the helicopter pilot, ¶ 22-23. Counts I and IV of the o rig in a l complaint purport to state claims for negligence against Liberty and Meridian based o n , inter alia: not utilizing air traffic avoidance equipment or monitoring air traffic
Liberty filed an identical motion in the related case. Civ. A. No. 10-518, docket no. 6.
The record includes the "Declaration in Lieu of Oath of Christopher Vellios, Chief O p era tin g Officer of Meridian, the Declaration of Thomas C. Regan, Esquire, counsel for M e rid ia n and Liberty." O n August 8, 2009, Steven Altman was piloting a single-engine, fixed-wing aircraft from T e te rb o ro to Ocean City, New Jersey when a helicopter owned by Meridian and operated by L ib erty for sightseeing tours also entered the Hudson River air traffic. The resulting accident cau sed the deaths of the pilots and passengers aboard both aircraft.
c o m m u n ic a tio n ; fostering a work environment that put profits over risk; not having a tour g u id e or lookout who could have permitted the pilot to concentrate solely on safe flight; not tra in in g pilots, and using flight plans that increased the risk of collision in heavily congested a ir space. The amended complaint repeats these allegations as to Liberty, but omits Meridian as a party. Liberty's position is that this action cannot proceed without Meridian and must be d ism issed . In the alternative, Liberty requests transfer under 28 U.S.C. § 1404(a). U n d e r Rule 19, "a court must first determine whether a party should be joined if `fe a sib le ' under Rule 19(a). If a party should be joined but joinder is not feasible . . . , the c o u rt must then determine whether the absent party is `indispensable' under Rule 19(b). If the p a rty is indispensable, the action cannot go forward." Janney Montgomery Scott, Inc. v. S h e p a rd Niles, Inc., 11 F.3d 399, 404 (3d Cir. 1993) (citations omitted). Rule 19(a) is a two-part analysis. First: can complete relief be afforded to the parties in the action in the absence of the unjoined party? This "inquiry is limited to whether the d istric t court can grant complete relief to the persons already parties to the action. The effect a decision may have on the absent party is not material." Janney, 11 F.3d at 405. Here, given th e nature of the original allegations against Meridian and Liberty 7 - and the availability of
"For the purposes of ruling on a motion to dismiss under Rule 12(b)(7) for failure to join [ ]indispensable party, the well-pleaded factual allegations of the complaint are accepted as true." Wilson v. Canada Life Assur. Co., 2009 WL 532830, at *2 (W.D. Pa., filed Mar. 3, 2009), citing J u r i m e x Kommerz Transit G.M.B.H. v. Case Corp., 65 Fed. Appx. 803, 805 (3d Cir. 2003); C le m e n t s v. Holiday Inns, Inc., 105 F.R.D. 467, 469 (E.D. Pa. 1984). Here, the amended c o m p l a in t does not include allegations as to Meridian. Therefore, the allegations in the original c o m p la in t informs the decision.
join t and several liability - plaintiff appears to be able to obtain complete relief on her claims w itho u t the presence of Meridian. This factor weighs against a finding that Meridian is n e c es s a ry . H o w e v e r, a finding that a party is necessary may result under either Rule 19(a)(1) or 19 (a)(2). "Clauses (1) and (2) of Rule 19(a) are phrased in the disjunctive and should be so tre a te d ." Janney, 11 F.3d 405 (citations omitted). Under Rule 19(a)(2), the issue is: What e ffe c t will resolution of the dispute among the present parties have on the absent party? This also involves two questions. First, would a decision impair or impede Meridian's rig h ts in the subject matter of the litigation? Rule 19(a)(2)(i). In this instance, a decision re g a rd in g the cause of the accident and the relative liability of the parties involved would im p a ir Meridian's ability to protect itself. It would not be present to assert cross-claims or p ro v id e evidence as to the potential liability of other parties. Given that Meridian is alleged to have actively participated in decisions that resulted in the death of plaintiff's decedents, its p re se n c e is crucial to a determination of liability, Whyham v. Piper Aircraft Corp., 96 F.R.D. 5 5 7 , 561 (M.D. Pa. 1982) (Scottish companies that owned and maintained aircraft were n e c essa ry and indispensable parties in action by plaintiff's decedent against estate of deceased p ilo t.) F u rth e r, the evidence of record is that a lessor-lessee relationship existed between L ib e rty and Meridian. A decision as to their relative contractual rights - including issues of re lea se and indemnification and resulting liability to plaintiff - could affect Meridian's rights u n d e r the lease vis-a-vis its liability to plaintiff. This factor suggests that Meridian is 5
n e c es s a ry . T h e second part of Rule 19(a)(2) entails whether continuation of the action without M e rid ia n would expose an existing party to "a substantial risk of incurring double, multiple, o r otherwise inconsistent obligations." Fed. R. Civ. P. 19(a)(2)(ii). A finding of liability a g a in st Liberty could result in further litigation as to its entitlement to indemnification from M e rid ia n either as a result of this contractual relationship or because of tort law. These issues w o u ld not be actionable if Meridian were joined in this action. This factor, too, suggests that M e rid ia n is a necessary party. A s a necessary party under Rule 19(a)(2), is Meridian's joinder feasible? The negative a n sw e r is that principles of due process will not permit this court's exercise of personal ju risd ic tio n over Meridian. "Federal courts have recognized two types of personal jurisdiction which comport with  due process principles: general and specific jurisdiction. General jurisdiction exists when a defendant has maintained systematic and continuous contacts with the forum state. Specific ju risd ic tio n exists when the claim arises from or relates to conduct purposely directed at the fo ru m state." Kehm Oil Co. V. Texaco, Inc., 537 F.3d 290, 299) (3d Cir. 2008) (citations o m itte d ). "If the defendant `maintains continuous and substantial forum affiliations,' then gen eral jurisdiction exists. If the defendant's contacts fall short of that standard, then at least o n e contact must give rise or relate to the plaintiff's claim." Wilson, 2009 WL 532830, at *5 (citatio n s omitted). A s to joining Meridian in this district: Meridian is a corporation organized under the 6
law s of the State of Delaware with its principal place of business in Linden, New Jersey. Its c o rp o ra te purpose is to own and lease aircraft to Liberty. It has no contacts with Pennsylvania - no offices or mail drop, no employees, no telephone service; it does not advertise or solicit h e re and does not maintain a website accessible from Pennsylvania. The lease with Liberty w a s not executed in Pennsylvania. Vellios Declaration. No contacts appear to exist between M e rid ian and Pennsylvania. Under these undisputed facts, Meridian does not have fair w a rn in g that it may be subject to suit in this state. Burger King v. Rudzewicz, 471 U.S.462, 4 7 2 (1985). Accordingly, joinder of Meridian is not feasible. Next, under Rule 19(b), is Meridian an indispensable party? There are four factors to consider: "First, to what extent a judgment rendered in the person's absence might be p re ju d ic ia l to the person or those already parties; second, the extent to which, by protective p ro v isio n s in the judgment, by the shaping of relief, or other measures, the prejudice can be le s se n e d or avoided; third, whether a judgment rendered in the person's absence will be a d e q u ate ; fourth, whether the plaintiff will have an adequate remedy if the action is dismissed for non-joinder." General Refractories Co. v. First State Ins. Co., 500 F.3d 306, 319 (3d Cir. 2 0 0 7 ), quoting Fed. R. Civ. P. 19(b). A s to the first two factors, which overlap Rule 19(a) - and mindful that "`a defendant's rig h t to contribution or indemnity from an absent [ ] party does not render that absentee in d isp e n sa b le pursuant to Rule 19,'" Janney, 11 F.3d at 412 (citations omitted) - the risk of p re ju d ice to the present defendants does not favor indispensability. However, the risk to M e rid ia n of a finding of no-liability on the part of the present defendants, would remain, as 7
w o u ld the risk of an inconsistent liability finding in this action. The parties have not su g g e ste d a means of shaping relief that could shield Meridian from this risk. This factor w e ig h s, albeit slightly, in favor of a finding of indispensability.8 T h e third factor weighs against indispensability, inasmuch as plaintiff can obtain c o m p le te relief against the present defendants, and, while inconvenient, issues of contribution a n d indemnification can be pursued in later litigation. T h e fourth factor, whether plaintiff would have an adequate remedy if the action were d ism isse d for nonjoinder, points in favor of indispensability. Here, "the court should consider w h e th e r there is any assurance that the plaintiff, if dismissed, could sue effectively in another f o ru m where better joinder would be possible." Wilson, 2009 WL 532830, at *11 (quoting F e d . R. Civ. P. 19(b), 1966 advisory committee notes). The New Jersey District Court is such a forum, and that court is currently processing five cases involving all of the defendants o rig in a lly named in this case - including Meridian. " T h e fact that there is an alternative forum in which comprehensive joinder can be e ffe c te d does not automatically warrant dismissal of the pending case," Moore's Federal P ra c tic e § 19.05[d], but it is a factor to be considered. Another factor is the lessened
Meridian can, as plaintiff suggests, appear voluntarily and eliminate the possibility of p r e j u d i c e . Wright & Miller § 1610 ("If the court cannot obtain personal jurisdiction . . . over an a b se n te e . . ., the court may encourage the intervention of absentees by notifying them of the p e n d e n c y of the action and giving them an opportunity to intervene."). Here, Meridian clearly has n o tice of this action - it has appeared and filed a motion to dismiss on jurisdictional grounds. This su g g ests that it will not voluntarily waive this defect and appear voluntarily. Litigating in P h i la d e l p h ia would not impose an undue burden on Meridian. See Moore's Federal Practice § 1 9 0 5 [1 ] [c ] ("the absentee's refusal to intervene . . . may justify the court's decision to proceed rath er than dismiss, unless, of course, other factors (such as harm to the defendant) dictate d i s m is s a l." )
d e fe re n c e given to plaintiff's choice of forum in these circumstances. See Molynlycke Health C a re AB v. Dumex Med. Surgical Prod. Ltd., 64 F.Supp.2d 448, 455 (E.D. Pa. 1999) (in d e c id in g a motion to dismiss for lack of personal jurisdiction or, in the alternative, to transfer v e n u e , where court lacks personal jurisdiction over a defendant, plaintiff's choice of forum is of less pertinence). T ra n sfe r of this case to New Jersey would permit plaintiff to assert all of her claims a g a in st all parties, and would eliminate the possibility of prejudice to the present parties in v o lv e d in this case, as well as to Meridian. Therefore, the fourth Rule 19(b) factor strongly fa v o rs indispensability. A s an alternative to dismissal, Liberty moved for transfer of the action to the District o f New Jersey under 28 U.S.C. § 1404(a). Section 1404(a) permits a court to transfer an a c tio n to any other district in which the action might have been brought if transfer serves the inte re sts of the parties and the witnesses, and if transfer is in the interest of justice. 28 U.S.C. § 1404(a). Defendant bears the burden of proving, based upon a number of private and public fa c to rs, that the action would "more conveniently proceed and the interests of justice be better served by transfer to a different forum." Jumara v. State Farm Ins. Co., 55 F.3d 873, 8 7 9 (3d Cir. 1995). The private factors are: plaintiff's forum preference as manifested in the original choice, . . . defendant's p re fe re n c e, . . . whether the claim arose elsewhere, . . . the convenience of the parties a s indicated by their relative physical and financial conditions, . . . the convenience of th e witnesses - but only to the extent that the witnesses may actually be unavailable for trial in one of the fora, . . . the location of books and records. Id . at 879-80. 9
P u b lic factors are: th e enforceability of the judgment, . . . practical considerations that could make trial e a sy , expeditious or inexpensive, . . . the relative administrative difficulty in the two fo ra resulting from docket congestion, . . . local interest in deciding local controversies a t home, . . .the public policies of the fora, . . . and the familiarity of the trial judge with a p p lic a b le state law in diversity cases. Id. Here, these factors weigh in favor of transfer. A s noted, in the circumstances of this case, plaintiff's choice of forum is entitled to less d efe ren ce because of the inability to join Meridian, a necessary party. Defendant Liberty's p re fe re n c e is New Jersey. Moreover, defendant Liberty posits that the collision occurred in N e w Jersey or New York airspace; further, that pilot error necessarily occurred there as well, a n d the air traffic controllers whose conduct is at issue were located in New Jersey at the time. F a cto rs opposing transfer are that the plane was maintained in Pennsylvania, and the pilot was tra in e d here. Moreover, plaintiff's damages witnesses are located in this jurisdiction.
Inc o n v en ienc e to witnesses is a factor. "However, [g]iven the proximity of the Eastern D istric t of Pennsylvania and the District of New Jersey, factors related to the convenience of the parties or witnesses and practical consideration do not render one forum significantly more c o n v e n ie n t than the other." Superior Precast, Inc. v. Proto Construction and Dev. Corp., 1999 W L 455594, at *6 (E.D. Pa., Jul. 6, 1999), citing Jumara, 55 F.3d at 882. Private factors w eigh slightly in favor of transfer. W ith respect to public factors such as simplifying the trial and making it expeditious a n d inexpensive through transfer to a forum where all parties can participate in one action, and a v o id the need for further litigation, these weigh heavily in favor of transfer. 10
U p o n consideration of all of the relevant factors, transfer of this case would serve the in te re sts of justice, and this action cannot, in equity and good conscience, proceed against the e x istin g parties and without Meridian. Accordingly, an order will be entered transferring this a c tio n to the District of New Jersey.
B Y THE COURT:
/s/ Edmund V. Ludwig Edmund V. Ludwig, J.
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